Motorola's and Verizon Wireless' $100 million marketing campaign for the Motorola Droid seems to be paying off with strong sales that will likely result in more than 1 million devices being sold by the end of the year.
The Droid, the only smartphone currently on the market that uses Google Android's 2.0 operating system, is Motorola's second Android device and it's available only on Verizon Wireless's network. The device is turning out to be the hit phone of the season, thanks in large part to an expensive and extensive advertising campaign.
Motorola Droid
(Credit: Motorola)Neither company is reporting sales figures. But analysts say sales look good. The companies have likely sold between 700,000 and 800,000 Droids since the device was launched in early November, according to equity analyst Mark Sue of RBC Capital Markets.
"Verizon's big marketing push for the Droid is strengthening as we close in on the holidays, and following our round of checks, we believe about 700,000 to 800,000 Droids have been sold, making our hurdle of 1 [million] Motorola Droids achievable for 4Q09 [ending December 31]," Sue said in his research note. "Motorola, for its part, has done a good job on the production side, and our survey of over 100 stores indicates strong demand, limited stock outs, and very few returns."
John Stratton, executive vice president and chief marketing officer for Verizon Wireless, said when the device was launched in late October that Verizon would be pouring in more money to market this device than any other phone it has ever sold. And now it looks like the money has been well spent. From advertisements that specifically highlight the Droid to ones that focus on Verizon's extensive and reliable 3G wireless network, it's clear that the company has AT&T and the Apple iPhone in its crosshairs.
AT&T has actually sued Verizon over the advertisements about its 3G wireless network coverage.
Some Verizon Wireless stores, especially in major cities, are selling between 100 and 200 Droids per week since the launch in early November, Sue added.
The success of the Droid is good news both for Motorola and for Verizon Wireless.
Motorola comeback
For Motorola, the Droid represents a chance to make a comeback in the cell phone market. The iconic American company that practically invented the cell phone market has struggled for the past several years now. After the runaway success of the ultra-thin Motorola Razr in 2004, the company has been unable to come up with a hit phone. And it has steadily lost market share to other competitors, such as Nokia, Samsung, and LG Electronics. It's also ceded market share in the fastest growing segment of the market, smartphones, to newcomers like Apple and Research In Motion.
Motorola's mobile devices CEO Sanjay Jha took a bold gamble more than a year ago when he decided to dedicate the company's resources to building phones using the Google Android operating system. The Droid and the Motorola Cliq, which is exclusively sold on T-Mobile USA's network, are the first two Motorola Android phones to hit the market.
But Jha said the Google Android operating system will not only be used in high-end devices like the Droid, but it will also be used to power less expensive phones, creating a new tier of smartphones that will eventually replace the basic feature phone category. Jha said the company will launch at least 20 more Android devices in 2010.
The success of the Droid is an important first step in getting Motorola back on track. But equity analyst Ittai Kidron of Oppenheimer said in a research note Monday that sales of the Motorola Cliq are falling short of expectations. Motorola is expected to sell 1.5 million smartphones in the fourth quarter. And two-thirds of them are expected to be Droids.
Kidron said the Cliq is not selling well mostly because of issues with battery life. Motorola is supposedly preparing a software patch to fix the problem. But he also noted that T-Mobile appears to be losing interest in the device and is not marketing it heavily.
But T-Mobile says that the Cliq is doing just fine. And the carrier said that it's committed to marketing the phone through the holiday season.
"The Motorola Cliq is very popular among our highly connected customers and is the only device with Motorola's innovative Motoblur solution," a company spokesman said. "T-Mobile is excited about the Motorola Cliq for the holidays and continues to showcase it prominently in T-Mobile retail stores and with recent holiday deals."
Verizon's iPhone alternative
The Droid's success is also important to Verizon Wireless, the nation's largest wireless operator in the country. It is the first device that offers a true challenge to Apple's iPhone, which runs exclusively in the U.S. on AT&T's network. While Verizon has a strong reputation for its network, consumers often complain about its lack of cool phones. Up to this point, Verizon has mainly competed against AT&T and the iPhone with RIM's BlackBerry devices. But RIM's touch-screen BlackBerry Storm, which was first introduced a year ago, was largely a disappointment.
The Droid offers Verizon customers an alternative to the iPhone on the Verizon network. This fact could help Verizon retain some consumers who were thinking of leaving for the iPhone. But it might also attract new customers who are either disappointed with AT&T's service or have heard bad things about the network.
Verizon Wireless representatives say the Droid is certainly an important part of the company's device line-up.
"We are pleased with sales over the holiday weekend," Brenda Raney, a spokeswoman for the carrier said in an e-mail. "This phone clearly fits the needs of a number of customers who are excited about its availability on the Verizon Wireless network."
But if analyst data is to be trusted, it is clear that the huge marketing budget for the Droid is at least part of the reason why the device has been so successful. The HTC Droid Eris, another Android device sold exclusively on Verizon's network, is not selling as well as the Droid, Sue said in his note. The HTC Droid Eris went on sale the same day the Droid was launched, but with much less fanfare.
Part of the problem is the fact that there are many Android devices coming to market. And the number will only increase next year. The lesson from the success of the Motorola Droid is clear. If device makers and carriers hope for break-out success, then they will have to spend big on marketing.
(Credit:
Phandroid)
Oh, you knew someone was going to do this. So let's just get it over with. And though some might think of this as a battle between the Droid and the iPhone for the nation's morality, let's be open-source about it: someone's trying to make a lot of money from cell phone porn.
A company with the obtusely childlike name MiKandi has launched a mobile app store that will exclusively cater to adults whose brain food consists of content that reflects their age. Yes, the sort of stuff some prefer to refer to as porn.
MiKandi's publicity material naturally avoids this term, referring to the more PC phrase "adult only." However, there is a little kink in its offering. According to Android fanperson site, Phandroid, the MiKandi Market apps only work with Android phones and not with Apple's more morally minded handsets.
Cupertino steadfastly sticks to its policy of refusing to allow apps filled purely with adult content, though some might dispute whether its definition of "adult" isn't occasionally a little idiosyncratic.
Not for a moment would one suggest that Verizon or Motorola or the deities at Google are necessarily in favor of porn apps. However, MiKandi is attempting to take advantage of the fact that the Android system is more open than the iPhone's.
So while the Android Market itself doesn't offer porn, nothing on your Droid phone prevents you from using MiKandi's services. The wise people at Phandroid do, however, offer stern warnings about MiKandi's workings.
Despite attempting to use MiKandi's services, purely for scientific purposes, Phandroid failed to actually secure access to any mature content. Remember, children, this sort of thing will always be a somewhat risky business.
In its attempt to redress the imbalance created by the latest Verizon ads, AT&T has hurriedly cobbled together not just one Luke Wilson ad, but several.
Curiously, one ad features precisely the same strategy as that of the latest iPhone advertising: reminding those who might still be on the fence, on the phone, or even on the lam that you can't simultaneously enjoy voice and Web surfing on the Verizon 3G network--and hence on the Motorola Droid.
So here we have Luke Wilson, still looking a little peaky and dressed in a difficult brown. Behind Luke, we have a man trying to use two phones (by implication, Verizon phones) to perform a task the iPhone will manage alone.
Some might find it entertaining that as his friend attempts to download something on one of his Verizon phones, he complains that it's all going rather slowly. Others might find this both true and funny.
AT&T hasn't merely paid Wilson a little more than 3G to make this comparison. Someone, somewhere, has, perhaps even wisely, said, "We need a map to counter Verizon's map."
So the writers hit upon the idea of a two-part extravaganza (this already aired during Tuesday's "Dancing with the Stars" finale), in which Wilson produces postcards from all the different American towns that really do--no, really--have AT&T 3G coverage.
Wilson says his job is to set the record straight, with respect to Verizon's vicious besmirching of the AT&T network. He tries his best. He tells us that AT&T covers 97 percent of all Americans--yes, 300 million people.
The AT&T map also seems far more filled-in and far more colorful than it appears in Verizon spots, though one suspects that local word of mouth might be rather stronger, in this instance, than national advertising. If you live in Spokane, Wash., for example, and you know someone there who has spotty 3G service on a particular network, that is far more powerful an influencer than any number of Wilson's postcards or Verizon's barbs.
It's enlightening, however, to discover that Wilson once dated someone in Tulsa, Okla., and it didn't work out. Did she catch him simultaneously calling and Web surfing? Perhaps we will never know.
It seems that Apple doesn't respect Verizon's Droid phone quite as much as it does Microsoft's PCs. But two new ad spots, launching Monday evening, come as close as Apple has done thus far to directly attack the allegedly do-it-all robotphone.
The Droid, you see, went after Apple in its teaser campaign with some telling remarks and the hearty claim that Droid does what the iPhone doesn't. Then Verizon decided it would be fun to knock both the iPhone and AT&T's spotty 3G coverage with its "Misfit Toys" concept.
AT&T has already replied by hustling a hastily-dressed Luke Wilson into directing a few resentful pins at Verizon's effigy. However these new ads, while entirely in keeping with the iPhone tone and style, end with a line that expressly assaults the doings of Droid--or rather, its alleged non-doings.
Both ads focus on the iPhone's ability to allow you to use voice and data capabilities simultaneously over the AT&T network. By asking gently at the end of each spot "Can your phone and your network do that?" Apple is bursting what it sees as the inflated stealth bombing that accompanied the launch of the Droid.
Apple iPhone Ad - Did You See My Email? from Arik Hesseldahl on Vimeo.
Apple iPhone Ad - What Time's The Movie? from Arik Hesseldahl on Vimeo.
These ads don't mention the Droid or Verizon by name. But the fact that Apple has decided to address its rivals, however obliquely, suggests that one can look forward to more accusations, more bickering, and more attempted one-upmanship.
'Tis the season of goodwill, after all.
Another iPhone worm has been spotted in the wild.
Unlike the previous exploitation, which merely changed a jailbroken iPhone's wallpaper to a picture of Rick Astley of "Rickrolling" fame, this new threat allows hackers to steal sensitive information.
According to security firm Sophos, which wrote about the exploitation after a Dutch ISP spotted it late last week, the worm attacks jailbroken iPhone and iPod Touch devices only.
The worm "uses command-and-control, like a traditional PC botnet," Sophos wrote in a blog post on Saturday to warn users about the exploit. "It configures two startup scripts, one to execute the worm on boot-up, and the other to create a connection to a Lithuanian server to upload stolen data and cede control to the bot master."
Jailbreaking, which has been around for about two years, is a hack that enables iPhone and iPod Touch users to download applications unavailable through Apple's App Store.
Sophos wrote that the worm attacks users on several ISPs, including UPC in the Netherlands, Optus in Australia, and T-Mobile in several countries worldwide. Worse, the worm spreads faster on a Wi-Fi connection than a 3G connection. Users with affected devices might notice extremely short battery life while on Wi-Fi. According to Sophos, that's mainly due to the worm engaging in "so much network activity."
When a device is infected, it's assigned a unique number so that the attackers can easily pinpoint a single device. It also looks for authentication systems that use SMS, better known as mTANs. mTANs are frequently used by banks that send an SMS message with a password to mobile phones, allowing people to log in to their online accounts, Sophos wrote.
In essence, this threat is serious.
Sophos recommends that people with infected iPhones and iPod Touch devices restore them back to Apple's most recent firmware update. For now, there is no other way to fix the problem.
Don Reisinger is a technology columnist who has written about everything from HDTVs to computers to Flowbee Haircut Systems. Don is a member of the CNET Blog Network, and posts at The Digital Home. He is not an employee of CNET. Disclosure.
Sony is planning a new online store a la Apple's iTunes, but with a few twists.
Announced at a strategy meeting in Tokyo on Thursday, the new service will hawk music, movies, books, and other downloadable content geared for its various electronics, including TVs, mobile phones, music players, and computers.
The service, which Sony aims to launch next year, will link the company's devices and digital content that it produces--setting it apart from other online stores.
"That's the kind of combination that I think is not seen anywhere else," Kazuo Hirai, Sony executive vice president for networked products and services, said in an interview with the Associated Press. "That I think is where our core competence lies, and that's a differentiator for Sony."
Hirai also spoke about the new service with BusinessWeek, saying that it won't just sell products but also tap into social networking by letting people upload their own photos or videos and connect with each other.
"It's not just access content, stream it, and enjoy," Hirai told BusinessWeek. "What are your friends watching right now? There's a screen that says all the programming that's available. It highlights all the things that your friends are watching, for example. It's a community experience."
Called the Sony Online Service for now, it will model itself after the company's successful PlayStation Network, a free service that has captured 33 million registered users who download movies, access social networks, and grab games for the PS3 and portable PSP console. Hirai said that gamers will be able to access the new online service directly through their PlayStation Network accounts.
Of course, Sony has been down this road before in 2005 with its late Sony Connect music service. The aborted iTunes clone was done in by internal politics and a failure to connect with consumers, forcing the company to shut it down in 2007.
But with a new, more cohesive management team put in place by CEO and president Howard Stringer, Sony is hoping to avoid the in-fighting that helped kill Connect.
Sony needs a shot in the arm at this point. Though the company pioneered the portable music concept 30 years ago with its Walkman, it has struggled to compete in the Digital Age. Continuing a string of quarterly losses, Sony took a $292 million net loss in its recent second quarter. Despite cost cuts and layoffs, the company is projecting a total loss of $1.3 billion for the full fiscal year.
When you've lost the first round in your case against Verizon's persistent and persuasive mockery, who do you turn to?
Luke Wilson, that's who. After all, he starred in "Legally Blonde" and, well, "Jackass Number Two."
Actually, Wilson is lovable. Truly lovable. Perhaps if he'd dressed down a little and Justin Long had suffered an interminable hiatus hernia, Wilson might have got the part of Mac, the Microsoft Mocker.
Instead, he has the slightly more difficult task of persuading the folks who adored him in "Old School" that AT&T's 3G will serve them well on the 3.10 to Yuma.
The creators didn't give him much of a script, as I suspect they wrote it a couple of lattes and a shot of bourbon before this opus was filmed in what looks like the empty space above Victoria's Secret in Santa Monica, Calif.
Luke is forced to stand before a board and prove that AT&T has the fastest 3G network, lets you talk and surf at the same time, and offers you more apps that feature people making strange noises, half-clothed women, and animals that smile when you touch the screen. (Disclosure: slight exaggeration)
Sadly, it all looks a little analog. Luke looks as if he'd prefer to be surfing, as he really doesn't have the tools to make you believe what he's being paid to say.
His hair looks as if it's been hurriedly greased with Czech lard and his face offers a certain hemorrhoidal mien as it offers a little jape at the end of the spot. Yes, a jape about Verizon beginning with "V" and AT&T not beginning with "V." That rumbling you can hear is the collective guffaw from Verizon Central.
Verizon is hurting AT&T with its clinical, delighted unpleasantness. And I fear that before "Legally Blonde 2: AT&T's Revenge" can possibly be effective, the iPhone carrier needs to dramatize its argument rather better than the gospel according to Luke.
As consumers increasingly purchase sophisticated smartphones such as the iPhone, BlackBerry, and Droid, they are developing expectations for how these phones allow contacts, calendars, e-mail, and social networks to remain in sync across all their devices.
One of the big challenges is that users don't always maintain the same source of inputting data--they switch from browser to desktop application to smartphone as their data access and entry point, introducing many variables into the data chain. And data integrity will only get more complicated as more applications become browser-based and keep no local data storage.
Most enterprise users have a local store in addition to the cloud storage, something that I still find puzzling from the T-mobile Sidekick outage, where consumer data that should have been in multiple locations (or at least present on the device) was thought to be lost.
The most common sync services are not provided directly by the mobile operator. Generally this is a good thing, as the more you can dis-intermediate the carrier, the more control you have over your data. But because the sync services are provided by others--notably Microsoft, Google, and Apple--you end up locked-in to their data structures as well as whatever privacy and data management issues that might arise in relation to advertising or other usage of your information.
Today, you can fairly easily sync your mobile device with most common online e-mail and PIM services although the BlackBerry, Droid, and the iPhone differ in their approaches--or at least in the visibility of how they work. For example, you can sync with Gmail and other services on the iPhone, but it rather perversely requires the Microsoft ActiveSync protocol.
By controlling the address book, Google and Apple effectively lock-in users to their sync service, leaving the carriers and devices to be easily replaced (minus the cancellation charges.) The user would barely notice the difference, aside from the sticker on his phone that says AT&T or Verizon.
Mobile operators do not want to cede control of the address book to Google or Apple, but they are late to the game and do not yet have sync solutions of their own. As a result, they are scrambling to add this functionality, but building a sync solution that works with all different devices and email services is no easy task, thanks to the widespread problem of device fragmentation in the industry.
One option is to deploy a white label solution, like the open mobile cloud sync offered by Funambol. Funambol CEO Fabrizio Capobianco told me the company has been approached by many of the top mobile operators, with several of them looking to setup sync services for their customers. They all recognize the issue, and according to Capobianco can turn to Funambol as a way to quickly bring a high-quality solution to market.
With all the different players in mobile sync, users will begin to question who owns their data. Enterprise users, in particular, should have privacy concerns about trusting their data to someone else. In the case of Android users, there is a growing anti-Google sentiment, and if Google already owns your email, calendar, and search queries, do you really want them to own your phone contacts as well?
Windows Mobile lost 28 percent of its smartphone market share between last year's third quarter and this year's third quarter, according to market researcher Gartner.
Figures released Thursday by Gartner show that Microsoft's mobile OS had 11 percent of the global smartphone market in Q3 2008. A year later, it had 7.9 percent. Meanwhile, the iPhone's share rose from 12.9 percent to 17.1 percent, and Research In Motion's share jumped from 16 percent to 20.8 percent.
Symbian's share fell from 49.7 percent to 44.6 percent over the same period--a 10 percent drop.
Read more of "Windows Mobile loses nearly a third of market share" at ZDNet UK.
U.K. wireless carrier Orange just started selling the iPhone, and it is trumpeting first-day sales numbers for the device.
(Credit:
Apple)
The carrier signed up 30,000 people with a new iPhone contract on Tuesday, its first day selling Apple's smartphone, according to a post on Twitter from a member of Orange's marketing department.
While 30,000 isn't necessarily a lot, compared to the "hundreds of thousands" of iPhones AT&T sold in its first weekend selling the iPhone 3GS in the United States, it's not bad for being the second carrier in a much smaller country, where the iPhone 3GS has been available for four months.
Until Tuesday, wireless provider O2 was the exclusive carrier of the iPhone in the United Kingdom. Orange currently has 16 million mobile customers, compared to O2's 22 million. Incidentally, Orange's experience as the second carrier of the device in a country would seem to make a decent case for Apple releasing the iPhone to more than one carrier in many other countries, including the United States.
The numbers were far more impressive than the iPhone's debut on China Unicom's network last week. China's first crack at selling the iPhone was by most accounts disappointing, with 5,000 units sold over the first four-day period.
Of course, China Unicom is dealing with factors Orange is not. Besides having to sell the iPhone without Wi-Fi connectivity, China has to contend with something U.K. and U.S. carriers largely do not: a vast market for iPhone knockoffs, or gray-market phones.
